The price of a newspaper building, the G.O. bond issue and more

I’m lucky to be included in an email group consisting primarily of former Kansas City Star business reporters, and not much gets by them.

For example, it was a member of that group who sniffed out last week the real estate notice about the $46-million asking price for the main Star building at 1729 Grand Blvd. and the eight-story printing plant across McGee.

On the heels of that revelation, another group member alerted me to news that The Star quickly had an offer in hand for the main building, and that the prospective buyer wanted to convert the building for commercial and residential use. Neither the identify of the prospective buyer nor the agreed-upon sales price was made public.

How much that building would sell for is a matter of keen interest not just to current and former Star employees but also to people in the real estate business and even many casual observers wondering how much a block of prime real estate in the booming Crossroads District (including The Star’s iconic, three-story building) would fetch.

Leave it to another member of the email group, former business reporter David Hayes, to provide the answer. Two days after the announcement of an offer for 1729 Grand, Hayes went back to the real estate listings and found a new, separate listing for the printing plant. The CBRE listing showed a price tag of $30.1 million for the printing plant, meaning (doing the subtraction) that the offer for The Star building must have been about $16 million.

I know very little about commercial real estate, but $16 million seems like a favorable price to the buyer, who eventually will be identified. The parcel consists of an entire city block, bounded by Grand and McGee on the west and east, and 17th and 18th streets on the north and south. That is prime real estate these days, and whatever goes in there should nicely augment the Crossroads.

First Friday in the Crossroads Art District

For many, many years the area south of Truman Road from about Broadway to Oak, was basically fallow ground. When I was working out of The Star building, it was often hard to find a place to get a decent sandwich, so we’d often track down to Crown Center, the nearest oasis.

Now, the entire area is an oasis. There are dozens of places to eat and drink, and night-time entertainment possibilities abound…It gives me no pleasure to say it, but the area will be better off without a couple of hundred employees banging around in the Star building, which now symbolizes a once-powerful institution struggling to retain its grip on relevance.

Sic transit gloria gazzetta.

**

Public votes on three major issues are coming up Tuesday, April 4. The Star has endorsed the three Kansas City questions comprising a far-reaching, general-obligation bond issue that would generate $800 million for a variety of projects, including flood control, roads and bridges, sidewalks, a new animal shelter in Swope Park and accessibility improvements to public buildings.

I agree with The Star and intend to vote “yes” on all three G.O. bond proposals.

Under state law, it takes a super majority of 57 percent to approve general obligation bonds in Missouri, and it will probably be close, even though there is no organized opposition.

The Star reported today that a telephone survey conducted Friday and Saturday showed that 62 percent of respondents said they favored the bond issues. Twenty-three percent said “no” and 15 percent said they were undecided. The survey had a margin of error of plus or minus 2.7 percentage points.

The Star also endorsed a renegade proposal for a one-eighth-cent citywide sales tax increase to spur economic development in the area bounded by Ninth Street and Gregory Boulevard on the north and south, between The Paseo and Indiana Avenue on the west and east. It would generate an estimated $8.6 million per year for 10 years.

I called this a renegade proposal because it got on the ballot by way of initiative petition — city officials didn’t initiate it — and because Mayor Sly James is openly hostile to it.

In a meeting at The Star, James said: “They (supporters) should have talked to me before they went out and got the damn initiative petition, and we could have had a conversation. But they didn’t.…I can’t support a tax I have zero idea what it’s going to be used for and controlled by zero people that I don’t know who are going to be.”

The proposal, whose supporters include leaders of the political group Freedom Inc., would place decisions for investing the money in the hands of a five-member commission. The mayor and council would appoint three commissioners, the Kansas City Public School District would appoint one, and Jackson County would appoint one.

While I agree completely that the East Side needs a lot bigger injection of public funds than it has been getting, I am very dubious about this proposal. First, I don’t like sales taxes. They are regressive because they hit hardest those least able to pay. Second, I fear graft and corruption. We already have one sales tax I don’t understand — Jackson County’s so-called COMBAT, anti-drug tax — and I’m not interested in another nebulous initiative that seems to be flying at the margins of government.

…On April 4, I recommend a “yes” vote on Kansas City Question 1, Question 2 and Question 3. But I recommend a “no” vote on Kansas City Question 4.

**

Did you hear that President Trump and EPA chief Scott Pruitt have selected a theme song for the EPA? Yep, it’s that oldie but goody by Lee Dorsey, “Working in the Coal Mine.”

Speaking on ABC’s “This Week,” Pruitt said Trump intends to bring back coal-mining jobs and reduce the cost of electricity. Never mind that renewable energy and natural gas have fast been displacing coal as a primary energy source, not only in the U.S. but worldwide. Nope, the president and Secretary Pruitt — and “My Old Kentucky Home” pal Sen. Mitch McConnell — are bound and determined to see a revival of King Coal.

They’re off their rockers, of course but, hey, they sure picked a great song to lead the way back to the golden age of black lung disease and fibrosis.

Just listen to the ache in Lee Dorsey’s voice when he sings…

Five o’clock in the mornin’ I’m already up and gone Lord, I’m so tired How long can this go on?

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10 Responses

Fitz, go read Dave Helling’s editorial saying “It’s OK to vote NO on 123.” You need to o more homework, Fitz. Sidewalkgate will be Sly’s infamous legacy. Led by Glorioso’s $1 million disinformation campaign financed by big businesses EXEMPT from property taxes–like the STAR building is. The City Manager admits the $8 tax is incorrect. And that city ordinance forbids paying for homeowners’ sidewalks. And his list will take 2 years. Meanwhile just $3 million for infrastructure will be spent–out of $800 million???? The fake news survey failed to inform the caller it was a PROPERTY TAX INCREASE. Geez, Fitz. Read up and change your mind. Sly James is running a clown college of folks trying to be meaningful.

If you like your shade tree, you can keep your sidewalk. Till the city bills you for it and sends you a coupon. You have to vote for the 123 bonds to know what’s in them. Shields and Justus cramming together their list, but City Manager is in charge, and his list is 2 years away. This GO bond issue is worse than the Ryan Health Care bill. DOA. Don’t you love elected officials trying to build a legacy on the taxpayer’s dime? Sly does not OWN a home–he rents on Union Hill–so he does not pay property tax. He had secretly planned his exit–his 23 skidoo–to replace Cleaver in Congress if Hillary won, Oops. Love that toy train on the wrong street–that doesn’t run in the rain?

24 years. Get your facts straight, Fitz. Of course James ratings are high–$1 million propaganda campaigns do that. And he ran against a homeless man and Clay Chastain. Of course he looks good compared to them. You could hold a gun to the head of every citizen in town save Glorioso, and nobody could name the council members.

Jim:
Sly James came to my building and gave a meaningful plea for the 1,2, 3 bonds.

Also, for nearly 15 years I’ve been involved in Dismas House of Kansas City, a little-known but effective agency that helps alcoholics and drug abusers leave their former lives behind and go on to productive ones. Without COMBAT we would not exist.

As to the bonds, Sly made an interesting statement at the SOTCKC last night: He explicitly said that the homeowners would NOT be assessed for sidewalk repairs made with monies from the GO bonds…for as long as that money lasted.

It was intriguing because, as tracyinkc points out, city regulations put the financial onus for sidewalk repair/maintenance on the homeowner…

though who I’d really like to strangle is the idiot(s) who replaced all the dead/dying elms in town with sweet gum trees. a pox on their house!

…yet Sly came right out and stated otherwise.

Sly’s caveat of ‘for as long as that money lasted‘ was slippery in and of itself; during the 5 minute drive from the Nelson to my home, I saw at least $100 million worth (in realistic terms) of sidewalk repair needed. That’s just one middlin’ neighborhood.

And we’ve not yet got to the streets or the bridges.

The example making the news today is the old stone bridge on Hillcrest in Swope Park; does the city plan to rebuild it to original spec? There’s a million bucks right there. Tearing it out and replacing it with a modern structure might be cheaper, but not by much. And we’re only talking about a 20 yard long bridge…

If there was an itemized list of work to be accomplished, with est. costs and project details (with est. milestones and finishing dates) available, I would vote for the GO bonds. As none of those things are present, I’ll be voting no.

By the by, among the usual suspects attending the Mayor’s speech last night was Yael; he was standing, somewhat by himself, in the back with the TV cameras and the few local reporters who bothered to show up. When asked –in passing– whether he was already posting the details to his blog, he responded in the negative, but that he would soon be. I would expect we’ll see his thoughts today.

I’d like to know, too, Nick, whose bright idea it was to line the parkways and boulevards with sweet gums. I’ve got to think Parks and Rec was the main perpetrator. Terrible decision — one of the worst public policy decisions of the last half century in KC.

Sales taxes are not only regressive, they are hostile to Main Street businesses that must now compete with online merchants who don’t have to charge the tax. In most parts of Kansas that’s an almost 10% discount for shunning your local businesses.

Sales taxes, however, pale almost to insignificance on the regressive scale when compared to property taxes. The Legends, for example, sold for $131 million but was county appraised at $99 million; a house in Piper sold for $925,000 but was county appraised at $305,000; and a house in Edwardsville which sold for $49,500 but was county appraised at over $178,000.

While these three were just randomly picked out for a KSHB story I was involved with, they are typical with analyses I’ve done using every property in the various MLS areas.